US Pushes Israel to Halt Defense Sales to China - 2003-01-02

The Bush administration said Thursday it has been pressing Israel to refrain from selling advanced military hardware and technology to China. U.S. officials say they're concerned such transactions might tip the military balance between China and Taiwan.

Signaling a tougher approach toward Israel's military relationship with China, the State Department has acknowledged having ongoing talks with the Israeli government on restraining such sales. But it stopped short of confirming an Israeli press report that the government of Prime Minister Ariel Sharon has frozen all defense contacts with China.

The report in the Israeli newspaper Ha'aretz, Thursday said the Bush administration made the request for Israel to cease its weapons relationship with China last month. It quoted an Israeli defense source as saying Israel agreed to comply because it considered the request a "dictate" from its chief ally, and that the Sharon government felt it had no choice in the matter.

It also quoted unnamed Israeli officials as complaining that the United States was seeking to maneuver Israel out of the lucrative China arms market, a suggestion dismissed by State Department spokesman Richard Boucher.

"The United States has made clear the strategic implications for U.S. security interests of Israel's defense trade and transfer of U.S.-made equipment and advanced defense technologies to China," he said. "So that's an ongoing subject of discussion with the government of Israel. It's based entirely on strategic concerns that the United States has, and any allegations that it's based on commercial considerations are unfounded."

Mr. Boucher said the military balance in the Taiwan straits has been the United States' primary concern with regard to Israeli sales to China.

He noted that in 2000 at the urging of the United States, Israel canceled a contract worth hundreds of millions of dollars to sell China its Phalcon airborne warning and control system.

The Phalcon has battle-management capabilities like those of the U.S. AWACS system and U.S. officials said at the time they were concerned it might give China an edge in a potential aerial conflict with Taiwan.

The State Department also confirmed Thursday that it has filed court papers accusing two leading U.S. aerospace companies of illegally transferring to China in the mid-1990s technology that could have helped Beijing improve its intercontinental ballistic missile force.

The two firms, Hughes Electronics and Boeing Satellite Systems, are alleged to have committed more than 100 violations of U.S. export control laws when they helped China correct booster rocket problems that had caused a series of failed commercial satellite launches.

The companies could face fines of up to $60 million and be barred from selling controlled technologies overseas. A spokesman for the Hughes Corporation, which also controlled the Boeing subsidiary at the time of the alleged offenses, has denied any wrong-doing.